Supreme Court To Examine If NCLT President Has Power To Transfer Cases Across States

The Supreme Court is set to examine the scope of National Company Law Tribunal President's power to transfer a case across states by way of an administrative order.A bench of CJI Surya Kant and Justice Joymalya Bagchi recently issued notice on a plea challenging the Gujarat High Court order which held that the NCLT President has no authority to transfer cases from one State to another through administrative orders.Issuing notice, the CJI's bench expressed prima facie doubt on the correctness of the High Court view. The issue that the Court has expressed inclination to examine was framed by the High Court thus:"Whether the NCLT, Delhi, in its administrative capacity, was justified in transferring the cases from the jurisdiction of Ahmedabad Bench, NCLT to the jurisdiction of Mumbai Bench, NCLT, more particularly, when the issue of transfer of those cases along with the objections filed by the petitioners pending before the NCLT, Delhi on its judicial side?"The case stems from the aftermath of the Corporate Insolvency Resolution Process (CIRP) of Essar Steel, which was approved by NCLT, Ahmedabad, in 2019 and upheld by the Supreme Court later that year. After completion of the process, some parties filed contempt and recall petitions alleging non-compliance. These were dismissed by NCLT, Ahmedabad, in January 2024.Following this, the counsel for some parties sent an email to the Tribunal, and the Members of NCLT–I recused themselves the very next day without explanation. Later, NCLT–II also recused, stating that the conduct of the same counsel amounted to “intimidation".While these issues were still before the Tribunal, the NCLT President in New Delhi issued two administrative orders on June 6, 2024, and February 10, 2025, transferring the pending matters from NCLT Ahmedabad to NCLT Mumbai.Aggrieved, respondent-Arcelormittal approached the Gujarat High Court. Vide the impugned order, the High Court quashed the recusal orders of January 9, April 23, and April 24, 2024, and the administrative transfer orders of June 6, 2024, and February 10, 2025. It directed that the cases be placed before a suitable Bench at Ahmedabad and allowed the NCLT President to constitute a virtual Bench for expeditious adjudication.Challenging the High Court order, the present petition was filed. The Supreme Court has issued notice limited to examination of the aforementioned issue. In a connected matter, where transfer of case was sought from NCLT, Amravati to NCLT, Hyderabad on the ground that a Technical Member "threatened" to vacate an interim stay, it observed that the plea to transfer was nothing but an attempt to browbeat the Tribunal members."The ground urged is nothing but a brazen attempt to browbeat the Members of the Tribunal. Proceedings cannot be transferred merely because the Presiding Officer or a Member, during the course of hearing, has made certain observations. Since the very foundation of the transfer application was motivated and entirely unjustified, we are of the considered view that the application was rightly treated as liable to be dismissed by the President of the NCLT, albeit on a different ground", the Court observed, while disposing of the plea and leaving the question of law open.Case Title: ANITHA RAYAPATI v. ARCELOR MITTAL NIPPON STEEL INDIA PRIVATE LIMITED, SLP(C) No. 848/2026Click here to read the order

Supreme Court To Examine If NCLT President Has Power To Transfer Cases Across States

Debby Jain

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